Progressive can't duck insurance obligation to rodeo

In Progressive Michigan Insurance Co. v. Super Kicker Rodeo Productions, et al., Progressive and ACE American Insurance Co. both tried to avoid paying for injuries suffered by Donielle Hart.  Both companies had underwritten liability coverage for the Rodeo's activities, but both argued that the coverage did not apply to Hart's very severe injuries.  Hart was a family member who helped out with the rodeo on an unpaid basis.  She helped to tear down the aluminum rodeo gates following a performance and suffered a skull fracture and other severe injuries when the loaded gates fell off a semi-trailer after a rope broke.  The trial court had dismissed the case against ACE and Progressive concluding that there were no questions of fact regarding the application of the insurance policies to the various individuals' employment status and the nature of Donielle's activities at the time of the injuries.

The Court of Appeals unanimously held that ACE was properly dismissed because an exclusion in its policy unequivocally applied to Hart's injuries.  It rejected Progressive's position on appeal, however, and remanded that part of the case to the lower court.  The appellate judges held that even though the process of "loading and unloading" are interpreted broadly under Michigan law, they are not so broad as to include Hart's activities in breaking down the rodeo gates.  The higher court held that if she was not an employee, and if she helped to break down the gates but took no further action to load the materials on the semi, her injuries would not be excluded from coverage under the Progressive policy:  Progressive's exclusion that denies coverage for injuries incurred by a non-employee while loading or unloading a vehicle would not apply to her under that factual scenario.

It is reassuring that one of the two insurance policies purchased by the rodeo may be required to honor its contract.  One can get the drift of Michigan jurisprudence by noting that it has taken a law suit, several years of delay, and at least one appeal, just to get a "day in court" to argue the possibility of liability coverage---where the company involved purchased two separate policies.  Before the Engler Majority rejected it, Michigan law dictated that an insurance policy must provide that coverage which a reasonable insured would anticipate at the time coverage was purchased (in part because most policies aren't even delivered to the insured until 30 days after the insurance is purchased).  Today, however, the Engler Majority's ruling on this point has created a free-for-all where almost any exclusion the insurer can put in the fine print may obviate coverage for the very risks  which were the basis for the insured's decision to pay premiums.  It is a sad state of affairs.